Thursday, May 19, 2011

Technical Picture - Technical Rebound In Play

The markets continued the rebound off the 62% retracement which bottomed yesterday. Tech and small caps outperformed the broader markets. I would expect the rebound to slow or stall into OPEX over the next two sessions as pinning comes into play, and as we move towards the down trendline.

Econ. Calendar - Initial Claims in pre-market, followed by existing home sales, Phil. Fed, and leading indicators at 10:00.

IPO - Looking forward to the LinkedIn IPO tomorrow symbol LNKD

Last night I posted the daily chart of ESRX as a bullish base on base pattern. Today it pulled back to its rising 200 SMA on the 15 minute timeframe and found support , as it has over the last few sessions.

An easy, low risk entry presented itself on the 1 min. chart below.

SNDK was a low risk short after price failed at resistance (blue line). The short extended to 1.27 and reversed, setting up a long. Looks like a solid C&H pattern setting up for tomorrow.

RIMMgapped up on an analyst upgrade, which ruined my morning star daily setup. Small scalp trade.

ALTR was very strong out of the gate. I waited for a Fib. retracement rather than chasing early strength. It worked well for a 1.27 FE.

I try to focus on both. I like trading setups that are familiar so that I can anticipate how it will develop. This current market environment is a little trickier than the straight up trending of the past eight months.

Agree that price discovery will likely see much lower price, but internet IPOs are worth trading on IPO day (small size) as these often run quite high on euphoria. BIDU in 2005 and now LNKD. Today I'll be watching the Russian internet IPO YNDX

My favorite EOD scans are momentum - price/volume expansion, NR7, stocks clearing 20, 50, or 200 SMA on higher volume. I also like to scan for candlestick reversal patterns. I run them in stockcharts.com